Investor Call Results H1 2017

Transcription

1 Investor Call Results H September 22nd, 2017 Michael Frick Corporate EVP and CFO Philipp Kuckuck VP Corporate Finance 1

2 Disclaimer This presentation was prepared with reasonable care. However, no responsibility can be assumed for the correctness of the provided information. In addition, this document contains summary information only and does not purport to be comprehensive and is not intended to be (and should not be construed as) the sole basis of any analysis or other evaluation. No representation or warranty (express or implied) is made as to, and no reliance should be placed on, any information, including projections, targets, estimates and opinions contained herein. By accepting this presentation you acknowledge that you will be solely responsible for your own assessment of the market and the market position of the Company and that you will conduct your own analysis and be solely responsible for forming your own view of the potential future performance of the Company s business. This presentation may contain forward-looking statements and information on the business development of MAHLE. These statements are based on assumptions relating to the development of the economies of individual countries, and in particular of the automotive industry, which we have made on the basis of the information available to us and which we consider to be realistic at the time of publication. The estimates given involve a degree of risk, and the actual developments of e.g. sales, results and financial situation may differ from those forecasted. We do not update forward-looking statements retrospectively. Such statements are valid on the date of publication and can be superseded. This presentation does not constitute an offer or invitation to subscribe for, or purchase any bonds issued by and neither this presentation nor anything in it shall form the basis of, or be relied upon in connection with, any contract or commitment whatsoever. This presentation does not contain or constitute an offer of, or the solicitation of an offer to buy or subscribe for, securities to any person or in any jurisdiction to whom or in which such offer or solicitation is unlawful. The information contained in this presentation is not for publication, release or distribution in the United States, Australia, Canada or Japan and, subject to certain exceptions, the securities referred to herein may not be offered or sold in the United States, Australia, Canada or Japan or to, or for the account or benefit of, any national, resident or citizen of Australia, Canada or Japan. 2

3 Highlights Successful development of dual strategy with focus on existing market position and future mobility trends Organic sales growth of 6% y-o-y, earnings and equity ratio negatively impacted by one-off items and FX effects Strengthened systems competence with regard to e-mobility by the takeover of electronics specialist Nagares Presentation of MAHLE Efficient Electric Transport (MEET) setting trends for urban mobility Improved financing profile due to successful refinancing of matured Schuldschein MAHLE will be a driver of e-mobility, just as it already is in the conventional market today 3

4 Market trends and strategic positioning Dual strategy focus on existing market position and future mobility trends Strengthen our existing market position Shape the future in a changing mobility world HVAC Highly efficient combustion engines Emerging Markets New projects Thermal management Commercial Vehicles & Off-Highway Aftermarket Electric drives & Power electronics Electric auxiliaries 4 HVAC: Heating, Ventilation and Air Conditioning

5 Market trends and strategic positioning Strategic evolution of business portfolio Acquisition Divestment +21.1% Sales CAGR Industrial filtration Forging activities Sinter component business Turbocharger Business BMTS Expansion of business into test systems for automotive aftermarket Acquire competence in automotive thermal components Complement mechatronics activities with e.g. electric drives Advance of strategic commitment in CO 2 reduction via WHR-system* Added a strong expertise in the mechatronics division MAHLE is now global no. 2 supplier for automotive thermal components Thermal Expansion of North American powertrain operations Acquire competence in thermoelectrics technology Acquire competence in vehicle electronics Strengthening presence in workshop equipment and services * WHR = Waste heat recovery system 5

6 Market trends and strategic positioning MAHLE start-up activities fertilizing an innovation culture Acquisition Cooperation Creation The start-up market is monitored to identify potential investments Innovative start-ups are screened to identify areas of cooperation Programs to develop corporate start-ups were initiated German start-up acquired in February 2017 Thermoelectric solutions to cool & heat batteries, etc. TinyInspektor is a German start-up with Israeli DNA Artificial intelligence technologies to boost shop floor production 6

7 HV Coolant Heate r icond Cabin Air Evapo. Chiller Chiller HV Coolant Heater < 60 C Oil cooler (<15 C) Battery < 40 C Market trends and strategic positioning Current developments addressing all crucial issues related to powertrain and air conditioning technology Optimization ICE Hybrid Alternative drives Friction reduced engine components CNG Components for alternative fuels Liquid management modules Compressor E-Compressor Climate system for R744 refrigerant R&D expenses (EUR mn) Battery cooling Quick charge ,1% 5,6% 5,7% 6,0% 5,8% H H ,0% 8,0% 7,0% 6,0% 5,0% 4,0% 48 volt drive system Cooling Air LT radiator LT radiat or Heater Core Electronics Heat pump Intake and exhaust systems for fuel cell vehicles 7

8 Market trends and strategic positioning MAHLE s demonstrator vehicle a new experience in urban mobility MAHLE Efficient Electric Transport 48-volt traction drive optimized for urban mobility Intelligent thermal management Climate neutral R744 air conditioning circuit Efficient thermoelectric heat pump Innovative individualrelated interior tempering Range + km + km + km + km 8

9 Financial results H All business units contributed to the strong organic sales growth of 6% Sales (EUR mn) + 5.9% ,563 6, % Exchange rate effects -1.8% M&A +6.0% Organic growth Jan Jun 2016 Jan Jun

10 Financial results H Organic sales growth twice as high as market growth but earnings impacted by one-off effects MAHLE Group Key financials H Sales EBITDA 6,563 mn 431 mn EBITDA margin 6.6 % Group sales grew by 5.9% as expected organic sales growth outperformed market growth** Earnings negatively impacted by warranty provisions Equity ratio temporarily below target range Net income Equity ratio Net debt/ EBITDA* Still strong net debt/ EBITDA ratio Successful increased refinancing of Schuldschein -20 mn 31.0% 1.4x * EBITDA for H calculated on the basis of trailing 12 months EBITDA **According to IHS, light vehicle production H % 10

11 Financial results H Balanced portfolio and global footprint Profit Centers 14.8% (-0.5pp) Aftermarket 7.6% (+0.2pp) Division Mechatronics 3.1% By business unit Engine Systems and Components 22.4% (+0.3pp) Sales split H Total: EUR 6.6 bn South America 5.2% (+1.0pp) Asia/Pacific 18.8% (+1.0pp) Africa 0.4% By region Europe 49.0% (-2.5pp) Thermal Management 34.7% Filtration and Engine Peripherals 17.4% North America 26.6% (+0.5pp) and (%) = Sales share H vs. H

12 Financial results H Earnings impacted by non-recurring effects EBITDA (EUR mn) EBITDA influenced by increased material prices and warranty provisions ,3% 9.5% 8.8% 8.8% % Amortization of goodwill and purchase price allocation within EBIT amounting to 1.1% of group sales H H EBITDA EBITDA margin EBIT (EUR mn) Additional impacts on net income Lower interest income y-o-y due to positive one-off effects in H % 4.5% 3.8% 4.0% % Increased tax rate due to higher nondeductible expenses and positive non recurring effects in H H H EBIT EBIT margin 12

13 Financial results H Reduced equity ratio due to one-off effects Equity (EUR mn) 2,555 2,667 2,722 2,743 2,561 Equity ratio is below target ratio due to 37.8% 34.0% 33.9% 33.1% 31.0% 33% Inflated half-year balance sheet total including excess cash from recent Schuldschein H H Equity Equity ratio Net debt* (EUR mn) H H Negative FX translation effects on equity Higher warranty provisions Net debt/ EBITDA ratio still within conservative target range Commitment to implicit investment grade rating Net debt Net debt / EBITDA** * Net debt = liabilities to banks + bonds cash in hand, bank balances and checks **EBITDA for H calculated on the basis of trailing 12 months EBITDA 13

14 Financial results H Adequate cash position after the first six months Cash flow development H (EUR mn) Reduced cash flow from operating activities due to cash out from EU antitrust fine and increased working capital High investments in property, plant, and equipment amounting to EUR mn Cash funds at the beginning of the period Incl. short term liabilities & excl. cash on banking accounts > 3 months Cash flow from operating activities Cash flow from investing activities Cash flow from financing activities FX and consolidation effects Cash funds at the end of the period Incl. short term liabilities & excl. cash on banking accounts > 3 months Positive cash flow from financing activities 14

15 Financial results H Well balanced maturity profile and diversified funding mix with different debt instruments MAHLE has continuously increased and diversified its investor base Maturity of EUR 1,600 mn RCF has been extended by one year to July 2022 New EUR 250 mn Schuldschein were issued in June, maturing 2023, 2025 and Total financial liabilities: EUR 1,829 mn (incl. liabilities to banks, bonds and certain other liabilities) Other liabilities to banks include ancillary facilities in Mexico and Turkey as well as bilateral loan agreements in Brazil, India and Japan * Other liabilities to banks (EUR 435 mn) Bonds (EUR 829 mn) SSD (EUR 565 mn) * EUR 118,5 mn of other liabilities to banks represent short-term drawdowns from RCF maturing in 2022 RCF = Revolving Credit Facility SSD = Schuldscheindarlehen 15

16 Outlook Full year 2017 sales expected to reach EUR 12.6 bn Passenger cars and light commercial vehicles Medium and heavy duty vehicles World market + 1.9% World market +4.6% Outlook Vehicle Markets* (Forecast 2017 vs. 2016) Europe North America South America Asia/Pacific + 2.8% -2.2% % + 2.1% Europe North America South America + 3.7% + 6.2% -1.3% Middle East/ Africa + 7.3% Asia/Pacific + 4.8% Outlook MAHLE Group Group sales expected to grow by 2-3% in 2017 Strong investments in R&D focusing our dual strategy Commitment to target equity ratio of 33% in the following years Improve cost situation and further integrate recent acquisitions ~12, e (guidance) *Source: Includes data provided by IHS, Copyright [2017], LV and MHD Production August 3 rd 2017 (Comparison Forecast 2017 with Actual 2016) 16

17 IR contact Investor Relations contacts Philipp Kuckuck Vice President Corporate Finance Pragstr Stuttgart Germany Verena Sigel Head of Group Financing and Investor Relations Investor Relations: Internet: Stefanie Hesse Corporate Finance and Investor Relations 17

18 Appendix 18

19 Company overview MAHLE is present in all global core markets enhancing its well-balanced footprint NORTH AMERICA Sales: EUR 1,745 mn (+8.0%) Employees: 16,262 (+4.4%) Production locations: 29 Development locations: % +0.5pp EUROPE Sales: EUR 3,214 mn (+0.7%) Employees: 34,766 (+0.5%) Production locations: 68 (-6) Development locations: % -2.5pp ASIA / PACIFIC Sales: EUR 1,237 mn (+12.2%) 18.8% AFRICA Sales: EUR 25 mn (+8.3%) 0.4% Employees: 16,200 (+0.9%) Production locations: 54 Development locations: 5 +1pp SOUTH AMERICA Sales: EUR 341 mn (+29.9%) 5.2% Employees: 1,044 (-0.9%) Production locations: 2 Development locations: - Employees: 9,024 (-3.4%) Production locations: 13 Development locations: 1 +1pp Countries with MAHLE production locations Development locations Note: Sales and Headcount figures as of June 30, 2017, Locations as of Dec 31, 2016 Sales by country of origin compared to H1 2016, Employees by region compared to Dec 31, 2016 incl. development locations and sales branches 19

20 Company overview Group structure reflects diversified product portfolio (As of Jun 30, 2017) BUSINESS UNITS DIVISION Engine Systems and Components Filtration and Engine Peripherals Thermal Management Aftermarket Mechatronics Sales: EUR 1,470 mn Sales: EUR 1,144 mn Sales: EUR 2,279 mn Sales: EUR 496 mn Sales: EUR 203 mn Employees: 27,468 Employees: 10,825 Employees: 22,694 Employees: 1,581 Employees: 3,930 PROFIT CENTERS Sales: EUR 971 mn Employees: 10,799 Compressors Engineering Services, Motorsports, and Special Applications Large and small Engine Components Industrial Thermal Management Control Units Front-end Modules 20

21 Outlook Global vehicle production expected to grow however uncertainty remains due to political risks Production of Medium and Heavy Duty Vehicles and Buses (>6t) [in thousand pcs.] Production of Passenger Cars and Light Commercial Vehicles [in million pcs.] World market Europe North America Forecast , % Forecast , % 22, %² 22, %1 17, % 17,4-2.2 % World market (incl. Middle East/Africa) Forecast 2018 Forecast 2017 Europe North America South America 3,1 Asia/Pacific Middle East / Africa % % 3,4 50, % 49, % 2, % 2, % Comparison Forecast 2017 with Actual 2016 South America Asia/Pacific % +4.6 % %² % % % % % % +4.8 % ² Comparison Forecast 2018 with Forecast 2017 Source: Includes data provided by IHS, Copyright [2017], LV and MHD Production August 3rd

22 Financial results H Income statement (key figures) in million EUR ACTUAL ACTUAL ACTUAL 1-6/ / /2017 in % of sales in million EUR in % of sales in million EUR in % of sales CHANGE in million EUR Sales 6, % 12, % 6, % Cost of sales and other income and expenses -5, % -11, % -6, % EBITDA % 1, % % Depreciation / amortization of tangible and intangible assets (incl. goodwill) & longterm loans and securities % % % -3.5 EBIT % % % Investment result % % % 39.4 Result from interest (incl. pensions) % % % Result from activities % % % Taxes on income % % % -0.7 Result after taxes on income % % % Other taxes % % % -1.9 Net income / Net loss % % %

23 Financial results H Assets ACTUAL 06/30/2016 ACTUAL 12/31/2016 ACTUAL 06/30/2017 CHANGE in million EUR % in million EUR % in million EUR % in million EUR Intangible assets % % % Property, plant, and equipment 2, % 3, % 2, % Financial assets % % % 25.2 Inventories 1, % 1, % 1, % 46.9 Receivables and other assets 2, % 2, % 2, % Cash and cash equivalents % % % Prepaid expenses % % % 14.0 Deferred tax assets % % % 8.5 Plan assets % % % -4.5 Total 8, % 8, % 8, %

24 Financial results H Equity and liabilities ACTUAL 06/30/2016 ACTUAL 12/31/2016 ACTUAL 06/30/2017 CHANGE in million EUR % in million EUR % in million EUR % in million EUR Equity 2, % 2, % 2, % Badwill % % % -0.1 Accruals for pensions and similar obligations % % % -7.8 Other accruals 1, % 1, % 1, % Bonds % % % 0.0 Liabilities to banks % % % Trade payables 1, % 1, % 1, % Other liabilities % % % 36.2 Total 8, % 8, % 8, %

25 Financial results H Abbreviated cash flow statement ACTUAL ACTUAL ACTUAL [in million EUR] 1-6/ / /2017 CHANGE Cash funds at beginning of period Cash flows from operating activities Cash flows from investing activities Cash flows from financing activities Total cash flow Change in cash funds from exchange rate movements and valuation procedures Change in cash funds from changes in the consolidation group Cash funds at end of period